The Bank of Japan's latest interest rate hike has failed to continue to boost the local currency, making the market increasingly bearish on the yen, which further strengthens the market's view that the structural weakness of the yen cannot be resolved quickly. Strategists at institutions such as J.P. Morgan Chase and BNP Paribas believe that due to factors such as the still large spread between the US and Japan, negative real interest rates, and continued capital outflows, the exchange rate of the yen against the US dollar will fall to 160 or lower by the end of 2026. They pointed out that this trend is likely to continue as long as the Bank of Japan continues to gradually tighten monetary policy and the risk of inflation caused by fiscal stimulus persists. After falling for four consecutive years, the yen rose less than 1% against the US dollar this year. The expected boost from the Bank of Japan's interest rate hike and the Federal Reserve's interest rate cut was not ideal. The yen briefly rose above 140 in April, but then lost momentum due to the uncertainty of US President Trump's tariff policy and fiscal risks brought about by changes in Japan's political situation. Currently, the yen exchange rate fluctuates around 156, which is not far from a low of 158.87 during the year.

The Bank of Japan's latest interest rate hike has failed to continue to boost the local currency, making the market increasingly bearish on the yen, which further strengthens the market's view that the structural weakness of the yen cannot be resolved quickly. Strategists at institutions such as J.P. Morgan Chase and BNP Paribas believe that due to factors such as the still large spread between the US and Japan, negative real interest rates, and continued capital outflows, the exchange rate of the yen against the US dollar will fall to 160 or lower by the end of 2026. They pointed out that this trend is likely to continue as long as the Bank of Japan continues to gradually tighten monetary policy and the risk of inflation caused by fiscal stimulus persists. After falling for four consecutive years, the yen rose less than 1% against the US dollar this year. The expected boost from the Bank of Japan's interest rate hike and the Federal Reserve's interest rate cut was not ideal. The yen briefly rose above 140 in April, but then lost momentum due to the uncertainty of US President Trump's tariff policy and fiscal risks brought about by changes in Japan's political situation. Currently, the yen exchange rate fluctuates around 156, which is not far from a low of 158.87 during the year.